Savills Property Management: How the business has evolved over the past decade
By Cecilia Chow
/ EdgeProp Singapore |
From left: Tang Chee Charn, deputy managing director of Savills Property Management; Winnie Wong, managing director of Savills Property Management; Patrick Pek, general manager of Absolute Maintenance Services; Robin Leow, managing director and head of Savills Integrated Facilities Management (Photo: Samuel Isaac Chua/EdgeProp Singapore)
SINGAPORE (EDGEPROP) - Singapore has over 3,000 active management corporations ranging from private condos to office buildings, retail malls, mixed-use developments and industrial buildings. That’s because even the residents of a 10-unit apartment block at Joo Chiat must form a managing body or management corporation strata title (MCST).
Savills Property Management has more than 180 projects and 52,000 units in its strata portfolio. “Our closest competitor has about 30,000 units under management,” says Winnie Wong, managing director at Savills Property Management. “That makes us the largest strata management firm in Singapore.”
Wong assumed the managing director position in January 2023, taking over from Chan Kok Hong, who had led the firm for 27 years. Chan assumed the new role of senior consultant. Simultaneously, Tang Chee Charn was promoted to deputy managing director of the firm to focus on leveraging Savills’ strength in strata residential to develop the strata commercial and industrial business. (Find Singapore commercial properties with our commercial directory)
Savills’ strata management portfolio is now skewed towards residential, says Wong. Residential projects constitute over 150 (nearly 84%) of the over 180 projects. They include the 341-unit One Shenton on Shenton Way, the 250-unit 8 St Thomas at St Thomas Walk and the 509-unit Sky Habitat in Bishan. Mega developments above 1,000 units include the 1,040-unit The Interlace on Depot Road, the 1,042-unit Marina One Residences at Marina Way and the 1,327-unit Sol Acres at Choa Chu Kang.
Commercial buildings in its portfolio include those in the CBD Core, such as 20 Collyer Quay, 108 Robinson Road and The Arcade. Savills also manages The Quayside waterfront F&B and commercial enclave at Robertson Quay, The Riverwalk mixed-use development, Orchard Gateway and the Orchard Gateway Emerald, as well as Tong Building on Orchard Road. In the industrial sector, its projects include Ubi Techpark, Woodlands BizHub and Vertex.
The 1,040-unit The Interlace on Depot Road is one of the condos managed by Savills (Photo: Samuel Isaac Chua/EdgeProp Singapore)
‘Fee compression’
In recent years, new players have emerged in the property management space, typically small- and medium-sized local companies that are now snapping at the heels of the big international property management firms. “These are young entrepreneurs, some of whom have worked in international property firms like ours,” says Wong. “After gaining several years of experience, they decided to venture out independently.”
The increased competition and smaller new players entering the market have led to “fee compression”, says Tang Chee Charn, deputy managing director at Savills Property Management.
Property management contracts are renewed annually, he adds. The expectation of an incumbent managing agent is a gradual upward progression in fees, factoring in staff salary increments and cost of business. Not anymore.
There have been instances where an incumbent managing agent who has managed the development for several years is asked to match the fees of lower tender bids received in a renewal tender exercise. Until then, the incumbent agent has seen annual fee increments for several years but is now asked to match the lower fees to retain the business. “That’s when you see fees come down after moving up for a few years,” adds Tang. “That’s a result of fee compression.”
Of the 180 strata property management contracts, close to 50 have been with Savills for over a decade. A few projects have been with the firm since June 1995, when Chan Kok Hong founded Chan Kok Hong Property Consultants. It was subsequently renamed CKH Strata Management Co until its merger with Savills in 2011.
Orchard Gateway and Orchard Gateway Emerald linked by the overhead bridge are both managed by Savills (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Complementary services
Savills provides on-site staff to manage the estates in its portfolio. According to Wong, the number of staff on the ground depends on the condo size. For projects like The Interlace, which has over 1,000 units, the number of staff on-site ranges from seven to 10. A condo development with 100 units or fewer could have just one person on-site.
Complementing Savills’ strata property management business is its integrated facilities management business led by Robin Leow, managing director and head of facilities management. The business handles non-strata-titled buildings, offices and institutions.
Last September, Savills acquired a stake in Absolute Maintenance Services, enabling the facilities management business to provide a whole suite of services, including building management, cleaning and security.
Savills’ facilities management (FM) arm handles more than 40 projects, including the offices of ING Bank, Great Eastern Singapore, investment manager Barings, Visa, and commercial banks such as Bank of East Asia and Bangkok Bank.
The firm has also secured several institutional and government agency contracts, such as the BCA Academy on Braddell Road, Jurong Town Corporation industrial estates, the Ministry of Education at Mount Sinai, the Ministry of Transport headquarters at PSA Building, as well as the headquarters of the Agency for Integrated Care at MND Complex on Maxwell Road and the agency’s 16 other locations.
BCA Academy on Braddell Road, where Savills is managing the property under the integrated facilities management (Photo: Savills)
Integrated facilities management, upskilling
Increasingly, Leow says that firms like Savills offer integrated FM services, including cleaning, security, and hard and soft services under one contract. “Traditionally, the cleaning services make up about 30% to 40% of the entire integrated facilities management contract.”
The FM industry has moved towards more outcome-based contracts as part of the Real Estate Industry Transformation Map launched in February 2018 by the Minister for National Development, Desmond Lee.
“To upscale the pool of practitioners in the cleaning and FM services, we are also using technology to enhance productivity,” says Leow. “We showcased it in the BCA Academy Campus project that we won two years ago.”
Before that, BCA was managing the property in-house. It was their first time outsourcing FM services to a third party. Leow notes that it was not just an FM contract but an outcome-based contract. Savills won two FM awards for the BCA Academy project: the Best Digital Transformation Award and Outstanding Outsourced FM Service Provider Award in 2021 and 2022, respectively.
Still, finding cleaning staff and security guards remains a challenge. “We have about 1,600 cleaning staff at Absolute Maintenance Services,” says Patrick Pek, general manager of Absolute Maintenance Services. “About 30% of them are foreigners. The rest are locals, but the average age is 60s.”
For instance, at Resorts World Sentosa, Absolute has been engaged to clean all the common areas and the carpark. “You need to have presentable janitors because it’s a casino resort, after all,” says Pek. “And you need to have able-bodied staff because cleaning the common areas some- times requires working out of doors in the hot sun. It’s tough finding locals to do such work.”
At Resorts World Sentosa, Absolute Maintenance Services has been engaged to clean all the common areas and the carpark (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Higher wages
Hence, the government introduced the progressive wage model (PWM), starting with NTUC in 2012. PWM is designed to help increase the wages of workers through upgrading skills and improving productivity. It covers Singapore citizens and Singapore permanent residents in the cleaning, security, landscape, lifts and escalator, retail and food services roles. Since Sept 1, 2022, PWM has expanded to cover retail workers, in-house cleaners, security officers and landscape maintenance employees.
With PWM, a general or indoor cleaner’s average pay will be increased over the next five years to almost $2,500 a month, says Pek. A cleaning supervisor can make up to $3,200 a month, compared to $2,000 today. “This year, the impact is the highest,” he adds. “From July 1, 2023, the mandated spike in a general cleaner’s monthly salary is about 20%.”
Even with the higher wages, Pek is not optimistic that it will attract young people to join the cleaning industry. “Anyone with minimum qualifications will move into other trades,” he says. “Cleaning is an industry that fewer people will join. So we have to manage the contracts.”
According to Pek, that requires “mixing and matching”. “For contracts that are more office-based, with a five-day work week, we will deploy our local staff,” he says. “For those that need a six-day work week, including weekends, or involve more tedious tasks, we will use foreign labour. So we have to mix and match.”
One of the critical challenges of property management and FM is hiring and retaining staff, especially security guards and cleaning staff. “Despite the reopening of travel borders last year, we are still faced with a shortfall in manpower resources,” says Wong.
Given the manpower crunch, investing in automation and technology has become increasingly important in the real estate industry. “Even before Covid, we were looking at ways to innovate,” says Wong. “We even wrote programmes for a facilities management system at one point.”
The firm has also invested in new technology to enhance efficiency. In 2017, Savills partnered HomeClick to implement iCondo, a tech-driven, facility customer relationship app for smartphones and tablets. It allows residents to interface with the building manager and the facilities. “With manpower so tight now, technology does help ease some of the manpower crunch,” notes Wong.
Savills is handling the facilities management of The Grid mall (formerly known as Pomo) [Photo: Savills FM]
Customer and concierge service
According to Tang, the profile and expectations of residents have also changed over the years. “There’s a lot more customer service and client-facing interaction required for the property management role,” he says. Hence, in April last year, Savills hired a former Singapore Airlines stewardess-turned-customer service manager to train property management staff on-site on the finer points of customer service, such as meet-and-greet, handling residents’ queries, complaints and disagreements, including service recovery process.
“Property management today is no longer just property management, where your primary role is supervising contractors on-site,” says Wong. “There’s a lot more resident engagement. The expectation of service has also changed.”
Tang agrees: “While handling the day-to-day operations is important, customer service is equally important.”
Concierge service has become increasingly crucial in condo management, notes Wong. “If you look at condo developments in Australia or the UK, you don’t see the condo manager but the front-desk staff who will handle all your queries and feedback on issues,” she says. “Singapore will be heading that way, but we still need to change people’s mindset.”
Even the security guards for non-strata-titled office and industrial buildings must take on concierge or front-desk duties. “The security guard is no longer just the person checking your ID at the front desk,” says Leow. “An increasing number are also going the extra mile to offer concierge service.”
With more people returning to the office, building owners have established post-Covid protocols. In the past, more people ate at their workstations. “But now, most offices have set up a pantry for their staff to have their meals,” observes Pek. “Other building owners have upgraded or redesigned their canteens and communal areas to make them more user-friendly.”
Some MNCs are still giving their staff the flexibility of working from home a certain number of days a week. “However, many of them have stepped up cleaning services as expectations of both staff and tenants have gone up post-Covid,” says Leow.
Check out the latest listings near Sky Habitat, One Shenton, The Interlace, Marina One Residences, Sol Acres, 20 Collyer Quay, Robinson Road, The Arcade, The Quayside, The Riverwalk, Orchard Gateway, Tong Building, Ubi Techpark, Woodlands BizHub, Vertex, The Interlace
Follow Us
Follow our channels to receive property news updates 24/7 round the clock.
EdgeProp Telegram
EdgeProp FacebookSubscribe to our newsletter
Top Articles
Search Articles